This segment from our 374 page SAP Sales and Distribution manual is being

made available as a sample of our training manuals. Please contact

David.Haynes@ERPtips.com if you have any SAP training needs, or visit
www.ERPtips.com for more information.

Written by Thomas Woelfel

Published by Klee Associates, Inc.
Copyright Klee Associates, Inc., 2007, 2008

Using Incoterms to Calculate Freight Charges

Many times you may want to use certain freight aspects to induce pricing
conditions. This example will show how you can use pricing for several different
forms of master data. If you want to learn more about pricing, sign up for the SD
Pricing class being offered by ERPtips.

SPROSales and DistributionBasic FunctionsPricingPricing

ControlDefine Condition Tables

Click on the Display Condition Tables box and Click on the Choose button.

The Allowed Fields show which fields are available to create the condition
tables and are the master data triggers for pricing. If needed, you can
customize the Field Catalog to add fields that are not standard if needed.

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SAPtips Sample Sales and Distribution Using Incoterms to Calculate Freight Chgs and Adv Pmyt Terms
 Using Incoterms to Calculate Freight Charges Klee Associates, Inc.

On this screen enter the Table you want to review – in this case 999 and click the

Enter button .

This screen shows the fields that are possible to use to create the condition
table; the fields on the left are the fields that are being used for this specific table.
For this table we are using Incoterms and Incoterms (part 2) as the key fields.

We will not review the next piece in detail, but will provide a quick overview. If
you are creating a new condition table it needs to be tied to an access sequence
(which is what sets up the key conditions we see in VK11). This Access
Sequence needs to be assigned to a Condition Type (the vehicle for the pricing
base price, surcharge or discount). The Condition Type then needs to be added
to a Pricing Procedure that we have reviewed in the Condition tab of the sales
order.

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Klee Associates, Inc. Using Incoterms to Calculate Freight Charges

Now that we have seen the Condition Table lets create a Condition Record.

Type transaction VK11 .

Type Condition Type KF00
The Key Combinations will pop-up – from here click the first radio button and
then press Enter,

On the next screen, we want to enter the record that will trigger the freight
charge. The Conditions are first tied to a Sales Area, then enter FOB in the first
Incoterm field FOB and in the other Incoterm field enter the town that your
customer has been created in. Also add the rate that at which you want this
surcharge to be calculated.

Just like the base price we set up, this price has the ability for validity
periods as well. This format is what is used in all of the condition records.

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 Using Incoterms to Calculate Freight Charges Klee Associates, Inc.

Field Value
Incoterm 1 FOB
Incoterm 2 Destination
Rate Student Choice

Once you have entered the information below, click the Save button .
OK, so how does this look in a sales order?
Type VA01 and enter the customer number you have created and the material
you have been using.

Field Value
Order type OR
Sales organization 1000
Distribution channel 10
Sold-to Party Student Customer

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Klee Associates, Inc. Using Incoterms to Calculate Freight Charges

Field Value
Material Student Material
Quantity Student Choice

Then go to the item conditions icon – the "Coin".

Click and highlight a line item and click the "Coin'.

On the Conditions tab, we see the freight condition for which we just created an
active condition.

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 Using Incoterms to Calculate Freight Charges Klee Associates, Inc.

This example of Freight is just one example of how to use the Condition
Technique and the Condition records to cause certain surcharges and
discounts for Sales pricing.
Click the green arrow back to exit the order.

Review Questions
1. Where do you go to set up the master data for a freight condition?

2. What is a key combination?

3. Where is a freight condition seen in the sales order and what is the menu
path?

Advanced Payment Terms

Terms of Payment can be used in many ways besides just giving your customer
a timeframe for payment. They can be used as a way to promote certain product
– in cases of certain Sales Deals (VB21) or Promotions (VB31) you can create a
special payment term tied to those deals. This, in theory, will increase the sales
for that product.

The Sales deal and Promotion functionality is a master record that is created to
put into effect special pricing, terms of payment, or delivery terms for a certain
product or groups of products. The information in the Sales Deal takes
precedence over the standard customer or material master data for the time the
Sales Deal or Promotion is in effect.
.
You can have multiple terms of payment on an order assigned to each line
item, but any time there are different payment terms on an order it causes a
Billing documents split. This is a standard setting in the copy control for
billing document create.
The terms of payment are handled in FI more often than in SD. In SD, we simply
tie them to the sales order via the customer master or specific sales deals. They
are then automatically posted to the sales order. The payment terms will default
in to the header of the sales order:

Observe the instructor..

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Klee Associates, Inc. Using Incoterms to Calculate Freight Charges

If there is a different terms of payment for an item it can be seen on the

ItemBilling DocumentTab
The Billing Document tab is the tab that contains all information that is specific to
billing-related activities for this item. For example: Incoterms, Payment Terms,
and Dunning-related information.

Once the Invoice has been posted, Accounts Receivable will begin looking at the
open receivable quantity. Each time an aging report is run (what is past due and
when is it due) the Invoice Date, Baseline Date (date from which the credit starts)
and the payment terms date are key fields that will be used to determine past
due items. This value is always recalculated based upon the date of the report to
see what the customer owes based upon the discount in the terms
To review how the payment is processed we will look at the following example.
Invoice of 100 USD on Jan 1, 2006

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 Using Incoterms to Calculate Freight Charges Klee Associates, Inc.

Baseline date = invoice date

Terms of payment of 2% discount 30 days, net 60 days
Customer pays 98 USD on Jan 25, 2006

When the payment is received, Cash is credited 98 USD – Expenses is debited 2

USD and the Customer account is credited 2 USD.

The customer credit is not a document, just a FI posting to lower the open
receivable to match the cash payment + discount applied.

For the full understanding of how FI handles the Accounts Receivable postings
for a payment discount please look into the ERPtips Finance class.

Review Questions
1. When the payment terms are put on the sales order what module is most
concened with this data?
2. What are two factors of payment terms?

Legal Speak:

Purchase of this book or acquisition at an ERPtips class, constitutes an implied

agreement by the purchaser to a limited, license granted to the purchaser by
Klee Associates, Inc., specifically for purposes limited to improving your personal
knowledge of SAP software which does not in any way compete with Klee
Associates.
This manual is protected by copyright law, and is sold or is part of an ERPtips
class with the following conditions:

The manual will be used for your personal professional development.

The manual will not be physically copied for distribution to other individuals or
converted to an electronic copy for distribution to other individuals, unless
copyright permissions for copying have been acquired from Klee Associates,
Inc.

The manual will not be used to conduct training classes by you or other
individuals, without the written permission of Klee Associates, Inc.
Inclusion of the concepts in this book in any internal client training material is
allowed if the source of the concepts is acknowledged as follows:

Copyright 2007, 2008

All rights reserved.
Used with permission.
Klee Associates, Inc.

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Klee Associates, Inc. Using Incoterms to Calculate Freight Charges

NO WARRANTY: This documentation is delivered as is, and Klee Associates

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